U.S. Supreme Court Rules Against FLSA Plaintiff After Rejecting Rule 68 Offer

In a 5-4 decision, the U.S. Supreme Court in Genesis Healthcare Corp. v. Symczyk ruled that a plaintiff’s Fair Labor Standards Act collective action against Healthcare Corp. must be dismissed because the plaintiff “had no personal interest in representing others.”  The plaintiff, Symczyk, was a registered nurse who brought the case on behalf of herself and “all others similarly situated.”  She alleged that Healthcare Corp. violated the FLSA by automatically deducting 30 minutes of time worked per shift for meal breaks for employees, even when the employees worked during those breaks.

Healthcare Corp. filed a $7,500 offer of judgment (in addition to reasonable attorneys’ fees, costs, and expenses to be determined by the court) along with its answer to the complaint.  Healthcare Corp. stipulated that if the plaintiff did not accept the offer within 10 days after service, it would be deemed withdrawn.  The district court ruled on a motion to dismiss for lack of subject matter jurisdiction that the Rule 68 offer of judgment mooted plaintiff’s lawsuit and dismissed the case.  The Third Circuit reversed, ruling “that calculated attempts by some defendants to ‘pick off’ named plaintiffs with strategic Rule 68 offers before certification could short circuit the process, and, thereby, frustrate the goals of collective actions.”

The U.S. Supreme Court reversed the Third Circuit’s decision and began its analysis by noting that “[w]hile the Courts of Appeals disagree whether an unaccepted offer that fully satisfies a plaintiff’s claims is sufficient to render the claim moot, we do not reach this question, or resolve the split, because that issue is not properly before us.  The Third Circuit clearly held in this case that respondent’s individual claim was moot.”  The Supreme Court also noted that the plaintiff waived the mootness issue because she did not raise this argument in her petition for certiorari.  Therefore, the Supreme Court assumed that the Rule 68 offer mooted the plaintiff’s individual claim.  The Supreme Court concluded that the case was properly dismissed for lack of subject matter jurisdiction because the plaintiff had “no personal interest in representing putative, unnamed claimants, nor any other continuing interest that would preserve her suit from mootness.”

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